Multilateral Cooperation
The Hague Convention on the Taking of Evidence Abroad in Civil and Commercial Matters 1970 is a well-known example. I of the Convention applies to letters of request, issued by the judicial authorities of a Contracting State in civil or commercial matters, to obtain evidence intended for use in judicial proceedings. A request can include oral testimony and the inspection of documents. Civil or commercial proceedings include tax proceedings, and probably also a claim for the restitution of profits in relation to insider-dealing
Clearly, however, the Convention does not cover the collection of evidence for regulatory proceedings having a criminal element. Nor, since it is confined to requests from courts,
(does it apply to the seeking of evidence by US grand juries.Under the Convention, countries like the United Kingdom have declared that they will not execute letters of request for obtaining the pre-trial discovery of documents. The Convention has thus not resolved another of the contentious extraterritorial claims by some states.
Mutual legal-assistance treaties have been heavily criminal however, so that they do not necessarily cover regulatory offences. Nor are they always sufficient to cover the preliminary inquiries before an offence can be prosecuted. Here, however, a memorandum of understanding (MOU) may be available. These fall short of being legally binding international instruments.
MOUs have been popular in areas such as securities regulation. An inquiry pursuant to a MOU may lead to the penetration of local bank secrecy.
The United States' view is that the Convention does not provide an exclusive and mandatory procedure for obtaining evidence abroad, and thus courts are not deprived of the jurisdiction they otherwise pos sess to order a foreign party to produce evidence located within a signatory nation. Where the Convention applies, however, proceedings otherwise to obtain evidence may cause objection on the part of other countries.
Outside the civil law, multilateral co-operation is patchy, at least as a matter of law on the books. In the United Kingdom Part I of the Criminal lustice (International Co-operation) Act 1990 gives compulsory powers to obtain evidence for foreign investigations and criminal proceedings. The evidence could be obtained despite a bank's duty of confidentiality.
No doubt in practice a great deal of multilateral co-operation between bank regulators occurs on an informal basis. This is fostered through the Basle Committee on Bank Supervision, meetings of non-GlO regulators, and the work within the European Community of the Banking Advisory Committee and the Group de Contact of EC bank regulators, and the Banking Supervisory Sub-committee of the European Monetary Institute.
As we saw in 3 the activities of the Basle Committee on Banking Supervision have resulted in important principles of banking regulation being harmonized across jurisdictions. In Europe this has been underpinned by the work of the European Community. Especially relevant to the discussion in this is harmonization with respect to money-laundering.64 Associated with harmonization within the European Community, of course, has been mutual recognition. Moreover, the Basle and European initiatives have also meant that co-operation between bank regulators in different jurisdictions has been facilitated on individual matters.
Jurisdictional clashes over banking matters continue to occur.
Some are resolvable in accordance with established legal doctrine, some in accordance with bilateral and multilateral agreements between states. Little seems achievable in reducing the conflict by pursuing notions of jurisdiction, comity, and the balancing of interests. Rather, shared concerns on substantive issues as in recent times with money-laundering are more likely to lead to deference by, and co-operation between, jurisdictions. Banks sometimes find themselves involved indirectly in these Jurisdictional clashes. Legally, there is little they can do to avoid this. In practice they could avoid being caught in the Jurisdictional clashes, which occur when enforcement agencies pursue the unmerito-rious and criminal across borders, by scrutinizing their customers and ceasing to do business in off-shore centres of dubious reputation
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